Brewing Tradition and Growth: Inside Saudi Arabia’s $2.27 Billion Coffee Market

Introduction: A Nation Brewing More Than Coffee

In Saudi Arabia, coffee is more than a drink—it is a symbol of hospitality, tradition, and social connection. Known locally as “Gahwa”, Saudi coffee is often brewed with cardamom and served in small cups alongside dates, a ritual that has defined gatherings for generations.

Today, however, coffee is not only a cultural pillar but also an economic driver. The Saudi Arabian coffee market, valued at USD 1.38 billion in 2024, is projected to reach USD 2.27 billion by 2033, expanding at a CAGR of 5.67%. This growth reflects the blending of tradition with modern café culture and the government’s ambitious Vision 2030 reforms.

The Kingdom is on its way to becoming both a major consumer and producer of coffee, with initiatives that could transform local agriculture, entrepreneurship, and global recognition of Saudi coffee heritage.

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Coffee as a Cultural Cornerstone

For centuries, coffee has been intertwined with Saudi hospitality. Serving Gahwa is an expression of respect, often marking important occasions and family gatherings. Lightly roasted beans, blended with spices like saffron or cloves, create a distinct flavor profile that reflects Saudi heritage.

This traditional role ensures a consistent demand for coffee in the Kingdom, even as younger generations embrace modern twists. In 2022, the Saudi Ministry of Culture declared the “Year of Saudi Coffee,” highlighting the beverage’s cultural importance and strengthening its position in national identity.

The Rise of Café Culture Among Youth

Urbanization and a youthful population are fueling a modern coffee movement. Cafés have become hubs for socializing, remote work, and cultural exchange, attracting millennials and Gen Z.

As of May 2023, Saudi Arabia’s population was 32.2 million, with 63% under the age of 30.

These younger consumers are drawn to specialty coffee shops, global chains like Starbucks and Tim Hortons, and local brands such as Barns.

With over 3,500 coffee shops nationwide in 2024, Saudi Arabia has one of the fastest-growing café cultures in the Middle East. The blending of Gahwa with espresso, cold brews, and latte art reflects how tradition coexists with international coffee trends.

Vision 2030 and Government Initiatives

Saudi Arabia’s government has positioned coffee at the center of its Vision 2030 diversification plan. Several initiatives are reshaping the market:

• Saudi Coffee Initiative – Boosting domestic farming in the Jazan region.
• Public Investment Fund (PIF) backing – A $319 million investment over 10 years to grow the national coffee industry from production to consumption.
• Production Goals – Raising annual coffee output from 300 tonnes to 2,500 tonnes.
• Farmer Support – Technical and financial aid, alongside collaborations with international partners.

In addition, Saudi Arabia has joined the International Coffee Agreement, ensuring technical expertise and global collaboration to strengthen its agricultural base.

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Market Segmentation: From Instant to Specialty Brews

The Saudi coffee market is diverse, reflecting both tradition and global influence.

By Type

• Instant Coffee – Convenient and widely used, especially in households.
• Ground Coffee – Popular in cafés and for traditional Gahwa.
• Whole Beans – Driving specialty consumption and premium retail demand.
• Others – Including capsules and emerging ready-to-drink formats.

By Distribution Channel

• Supermarkets & Hypermarkets – Still the largest retail channel.
• Convenience Stores – Meeting quick purchase needs.
• Online Retail – Growing rapidly with e-commerce expansion.
• Others – Including cafés, specialty shops, and direct-to-consumer brands.

Key Players Driving Competition

Several multinational and regional companies dominate the Saudi coffee market:

• Nestlé SA – A strong player in instant coffee through its Nescafé brand.
• Starbucks Coffee Company – Continues to expand outlets across urban centers.
• The J.M. Smucker Company and Kraft Heinz Company – Leveraging packaged coffee products.
• Luigi Lavazza SPA and Tata Global Beverages – Catering to specialty and premium demand.
• Barns (local brand) – Operating 500+ stores, second only to Dunkin’ Donuts in market presence.

Partnerships are also shaping the sector. For example, in March 2024, Alghanim Industries entered a strategic partnership with the Saudi Coffee Company to expand the Jazean specialty brand, while in May 2024, a license was granted to open a coffee manufacturing facility in Jazan.

Trends Shaping the Future of Coffee in Saudi Arabia

• Specialty Coffee Surge – Younger demographics demand unique brews and barista-driven experiences.
• Sustainability Focus – Brands like JAZEAN emphasize eco-friendly sourcing and high-quality Arabica beans.
• Local Farming Growth – Efforts to quadruple production are creating new opportunities for domestic farmers.
• Global Recognition – Saudi Arabia’s push for UNESCO heritage recognition underscores coffee’s cultural significance.
• Tech Integration – Online ordering, delivery platforms, and digital loyalty programs are reshaping consumer habits.

Future Outlook: Brewing Global Potential

The Saudi Arabian coffee market stands at the intersection of heritage and innovation. With government investments, café culture expansion, and international partnerships, the Kingdom is poised to not only meet rising domestic demand but also emerge as a notable coffee producer on the global stage.

By 2033, with a market size of USD 2.27 billion, Saudi Arabia’s coffee sector will reflect a unique blend of tradition, youth-driven modernity, and state-backed growth. From the majlis serving Gahwa to bustling specialty cafés in Riyadh, coffee will remain both a cultural anchor and an economic opportunity for the Kingdom.

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